[anonu]

> you only need to place trades when a company is added or removed from the index.

Not true for a price-weighted index. If there is a stock-split, the price will change as will the weighting. AAPL split in August 2020 4 for 1. It was 11% in the DJIA before the split - and close to $500 stock price. Post-split, all DJIA tracking funds had to sell AAPL as it probably went down to 2.5% weight. Consequently, all other stocks in the DJIA were to buy. Luckily, there aren't too many dollars tracking the DJIA.

> With a market cap weighted index you have to make more frequent trades every time a company does a buyback or issues new shares.

It depends. If the index is free-float market-cap weighting then yes, there will typically be a free-float adjustment at each rebalance (typically quarterly). But if there's no free-float adjustment then you need not do anything. Though managing a fund that tracks a free-float weighted index is not really an issue - there's some operational work to do on each rebalance.